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Policy relevant lessons from research on renewable energy auctions

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  • Anatolitis, Vasilios
  • Río, Pablo del
  • Kitzing, Lena
  • Fitch-Roy, Oscar
  • Szabó, László

Abstract

Renewable energy auctions have emerged globally as a primary tool for promoting electricity from renewable energy sources (RES-E) by awarding operational support to projects that bid the lowest level of required support. While their widespread adoption reflects perceived efficiency advantages over other support mechanisms, such as administratively-set tariffs, the effectiveness of RES-E auctions in meeting policy objectives is highly sensitive to specific design elements. This paper synthesizes policy-relevant insights from extensive research in the EU-funded AURES II project, which has analysed renewable energy auctions in diverse contexts with a focus on European countries. Key findings from the AURES II project address how auction design influences outcomes across multiple criteria, such as cost-effectiveness and project realisation rates. The paper highlights both successes and challenges in auction implementation, emphasizing the common trade-offs between policy objectives. Results underscore that well-designed auctions can promote RES-E efficiently, but also caution that suboptimal design can lead to unintended outcomes. Based on these findings, the paper offers forward-looking recommendations to guide policymakers in optimizing auction design to balance policy goals and enhance renewable energy deployment.

Suggested Citation

  • Anatolitis, Vasilios & Río, Pablo del & Kitzing, Lena & Fitch-Roy, Oscar & Szabó, László, 2025. "Policy relevant lessons from research on renewable energy auctions," Energy Policy, Elsevier, vol. 203(C).
    • Handle: RePEc:eee:enepol:v:203:y:2025:i:c:s0301421525001314
    DOI: 10.1016/j.enpol.2025.114624
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    References listed on IDEAS

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    1. Fleck, Ann-Katrin & Anatolitis, Vasilios, 2023. "Achieving the objectives of renewable energy policy – Insights from renewable energy auction design in Europe," Energy Policy, Elsevier, vol. 173(C).
    2. Đukan, Mak & Kitzing, Lena, 2021. "The impact of auctions on financing conditions and cost of capital for wind energy projects," Energy Policy, Elsevier, vol. 152(C).
    3. Đukan, Mak & Kitzing, Lena, 2023. "A bigger bang for the buck: The impact of risk reduction on renewable energy support payments in Europe," Energy Policy, Elsevier, vol. 173(C).
    4. Diallo, Alfa & Kitzing, Lena, 2024. "Selection bias in multi-technology auctions: How to quantify and assess efficiency implications in renewable energy auctions," Energy Policy, Elsevier, vol. 184(C).
    5. del Río, Pablo & Kiefer, Christoph P., 2023. "Academic research on renewable electricity auctions: Taking stock and looking forward," Energy Policy, Elsevier, vol. 173(C).
    6. Anatolitis, Vasilios & Azanbayev, Alina & Fleck, Ann-Katrin, 2022. "How to design efficient renewable energy auctions? Empirical insights from Europe," Energy Policy, Elsevier, vol. 166(C).
    Full references (including those not matched with items on IDEAS)

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